Intelligent Energy

Here comes the affordable LED bulb

Posting in Energy

Mass market LED bulbs appear on the horizon, as prices plummet in India, Far East chip glut continues, and Chinese manufacturers face a shake out.

More global signs have emerged indicating that the price of LED light bulbs could soon decline sharply and move closer to a level that mass-market consumers can afford.

LED bulbs augur great energy and CO2 savings because they require only about 20% of the electricity that incandescent bulbs do.

But prices of $40 in the U.S., and comparable retail tags in other countries, have dampened sales, even though the bulbs save on fuel bills and supposedly last for 25 years.

The price barrier is beginning to tumble.

A report today in India’s The Economic Times says that in that country, “prices of LED lamps and luminaires have almost halved in the past 6-9 months.” Lamps – by which the article seems to mean “bulbs” -have declined to “as low as Rs 600 ($13), down from above Rs 1,000 ($22),” it says. Luminaires “now start at Rs 2,000 ($44),” it states.

The article attributes the decline to local production by Dutch manufacturer Philips, and also to “a fall in global prices of their chips", referring to the light emitting diode chips around which the industry builds LED bulbs and lighting products .

As reported here, the price of those chips is tumbling because Asian manufacturers have overproduced.

In its latest update on the glut, market research firm LEDinside has predicted a possible shakeout among Chinese LED manufacturers. Beijing’s tightening of monetary policy and banking restrictions will make it harder for some Chinese manufacturers to land the subsidies and capital on which they rely for expansion and daily operations, LEDinside says. That, combined with rising labor costs, could drive some “second tier” manufacturers out of business, it notes.

Chinese, Taiwanese and S. Korean manufacturers are all either curtailing expansion plans or slashing prices to clear inventory, LEDinside has reported. The research firm has blamed the inventory glut on a slow down of LED sales to the backlit TV industry. It predicts the oversupply will last into next year.

LED bulbs are failing to catch on significantly in all countries other than Japan, it claims.

Photo: Wikimedia Commons

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Mark Halper

Contributing Editor

Mark Halper has written for TIME, Fortune, Financial Times, the UK's Independent on Sunday, Forbes, New York Times, Wired, Variety and The Guardian. He is based in Bristol, U.K. Follow him on Twitter. Disclosure